Kathmandu has lifted sales and profit as a new business underpinned sales, and has resumed paying dividends.
Photo: RNZ / Nate McKinnon
The outdoor goods and clothing company's first half profit was $22.3 million compared with $7.6m the year before, which contained significant one off costs involved with the acquisition of the Rip Curl business.
The underlying profit, which excludes one-off costs and accounting changes, was up by nearly a third to $23.1m, as sales rose by 12.9 percent driven by Rip Curl and to a lesser extent the shoe company, Oboz.
The growth in those businesses offset a marked fall in Kathmandu stores in Australia and New Zealand, which were heavily hit by Covid-19 related lockdowns.
Outgoing chief executive Xavier Simonet said the performance of Rip Curl had justified the group's move to diversify.
"Benefiting from increased participation in surfing in Australia, Europe and the USA, Rip Curl achieved strong sales and profits despite Covid-19 trading restrictions, reflecting the brand's technical product focus and strong consumer engagement."
He said Rip Curl's sales almost doubled and its wholesale order book was back above pre-Covid-19 levels.
The hardest hit part of the business was the Kathmandu stores on both sides of the Tasman, which were hit by multiple closures because of Covid, with sales down more than a third.
Simonet said the company was expecting to cut $15m of costs through various initiatives, and was looking at driving sales through connecting better with customers.
"We will begin implementing a loyalty program at Rip Curl, and Oboz is launching a direct to consumer online store. Kathmandu continues to invest in personalisation and data analytics capability, all with the aim of driving best in class customer interactions."
He said near term focus was on the winter performance of its Australasian stores, which was normally a strong sales period, while Rip Curl had also maintained its strong first half result.
Last year the company strengthened its finances with a $207m capital injection, and that along with the improved sales had allowed a resumption of dividends, which had been suspended. An interim dividend of 2 cents a share will be paid.